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Episode 19 | Why Are Prescription Drugs So Expensive?

Welcome back to "The Only Healthcare Podcast." This episode delves deep into the evolving landscape of healthcare policy in 2025. Hosted by Randy Vogenberg, PhD we are joined by special guest Jayson Slotnik, a seasoned health policy expert from Health Policy Strategies, LLC.

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In this episode of Only Healthcare, hosts Michael Navin and Dr. Randy Vogenberg dive deep into one of America's most pressing healthcare questions: Why are prescription drugs so expensive?


Michael, a leading expert in biotech market access and commercialization strategies, unpacks the complex web of pricing decisions, negotiations, and middleman systems that drive up drug costs for patients and employers alike.



Key Topics Discussed:


  • Drug Pricing Fundamentals - How pharmaceutical companies set initial prices based on market research, differentiation analysis, and anticipated rebate demands from pharmacy benefit managers

  • PBM Rebate Evolution - The dramatic shift from 10-25% rebates in the early 2000s to today's 50-80% rebate demands, and how this has fundamentally distorted market pricing

  • Patient Cost-Sharing Crisis - Why patients pay full list prices until hitting deductibles while rebates flow to PBMs, leading to $24 billion in pharmaceutical industry copay assistance programs in 2023

  • Technology Solutions & Reform - How AI-driven pricing transparency, machine-readable rebate files, and direct-pay programs from companies like Lilly and Novo are beginning to bypass traditional middlemen

  • The broken pricing system isn't just complex. it's actively preventing market competition and forcing patients to pay inflated prices while PBMs profit more than drug manufacturers themselves.



Chapters:

(00:00) Introduction

(01:00) Drug company pricing strategy fundamentals

(04:00) Evolution of PBM rebates from 10% to 50%+

(07:00) Real-world pricing example: Why $60 drugs can't compete with $700 alternatives

(10:00) How PBMs now make more money than drug companies

(16:00) The $24 billion patient assistance crisis

(20:00) Technology solutions and transparency reform

(22:00) Key takeaways for system change


For feedback or to suggest topics for future episodes, reach out to us at onlyhealthcarepodcast@gmail.com.


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Disclaimer:© 2025 Only Healthcare Podcast. All rights reserved.


This podcast and its content, including but not limited to audio recordings, images, and text, are the property of the Only Healthcare Podcast and are protected by international copyright laws. We appreciate all distribution and content sharing. Contact us at onlyhealthcarepodcast@gmail.com to access media kits, provide feedback, inquire about guest participation or to learn more. Thank you for listening!


Hosted by: Michael Navin & Randy Vogenberg, PhD


This Podcast is sponsored by:


Peek: Peek is reimagining access through innovation, technology, connectivity, and partnership. Peek offers a comprehensive and unique suite of solutions to help clients improve access and affordability for prescription drugs.


The Peek Meds Marketplace is one of Peek’s differentiated offerings that gives employers a revolutionary new approach to controlling runaway prescription costs for their employees by providing unprecedented transparency, simplicity - and cost savings. The Peek Meds Marketplace aggregates cash discount cards, manufacturer copay offset programs, and an employee’s insurance information to provide a holistic and personalized view of prescription price options. This easy-to-use platform offers a one-stop-shopping experience for prescription drugs.


Peek’s team has decades of experience in the pharmaceutical industry and offers various services to biopharma manufacturers, brokers, benefits consultants, third-party administrators and employers. Visit peekmeds.com to learn more.


Institute for Integrated Health (IIH): Health care benefits, insurance coverage regulations, and doing business in the healthcare industry can be complicated. At IIH, Dr. Randy Vogenberg and his team understand these unique challenges and provides strategic guidance customized to every client. To help overcome your unique challenges, IIH delivers education, planning and advisory on market trends, and U.S. health care market intelligence. The firm’s decades of proven success are due to strategic collaboration with associates from the business, clinical, and scientific communities. https://iih-online.com/.




 
 
 

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